Medical bills are now the leading cause of bankruptcies in the U.S., according to the price-comparison website, NerdWallet Health. The actual total of medical bills included in bankruptcies is probably even higher than reported. Credit cards are often used to make payments on medical bills.

Having health insurance does not immunize someone against high medical bills. Large co-pays, maximum out-of-pocket maximums of $5-10,000 or uncovered medical treatment leaves many with substantial balances owed to hospitals, clinics and doctors. Others find themselves forced to pay out-of-pocket for an out-of-network specialist or necessary treatment. Of course, when someone is seriously ill, they are often unable to work, reducing their income and exacerbating all of their financial problems. Less than 9% of all 2014 filers had not experienced a medical crisis, job loss or divorce, reports a Lawyer in Lawrence KS.

Since the 1990s, the demographics of bankruptcy have been slowly changing, as the average age of people filing for bankruptcy slowly rises. At one time, very few seniors filed for bankruptcy, but those over 55 now total about 20% of bankruptcy filers. High medical bills are tied to the increasing number of seniors filing for bankruptcy, since older people as a group have the most health issues. Bankruptcy statistics for 2014 showed that half had been dealing with a serious health issue.

Medical bills can be included in either a Chapter 7 or Chapter 13 bankruptcy. Those filing for Chapter 7 are typically low-income debtors with few assets that the Court would sell to pay back creditors, so medical bills would be discharged with other unsecured debt. Chapter 13 debtors have a regular income and pay off the debt over 3-5 years under a Court-approved repayment plan. The medical bills would be included in the repayment plan. When the bankruptcy is final, any remaining debt is discharged.

Medical bills are seldom a matter of choice. No one chooses to have a heart attack, cancer or a chronic illness. It doesn’t take long for just one hospital stay to rack up a huge bill, even if insurance covers part of the cost. Talk to a Lawyer in Lawrence KS about your legal options. Schedule a free legal consultation with Joe Wittman in Lawrence KS he dedicates his practice to representing those who need help in getting their lives back on track.